AMD is gaining ground on Intel as the long-time chip-industry leader is facing a processor shortage.

Fubon Research reported this week that Intel will undersupply the PC market with chips between the last quarter of 2018 and the second half of 2019 by 15%, according to Jefferies.

That's good news for rival AMD, according to analyst Mark Lipacisto, who raised his price target to $36 from $30 and reiterated his "buy" rating. AMD shares climbed as much as 4% on the news before paring their gains.

According to Lipacisto, AMD's profitability and market share have been tied to Intel's utilization. "The best scenario for AMD is when Intel is capacity constrained - not only does AMD benefit from share gains, but also from benign pricing which leads to higher margins," he wrote in his note sent out to clients on Friday.

Intel's problems come at a good time for AMD, which admitted on its earnings call in July that revenue from the cryptocurrency boom has dried up and that it expected the impact to fall to nearly zero in the third quarter. Crypto made up 6% of its revenue in the second quarter.

"AMD's stock has appreciated by 200% YTD vs 11% for the SOX - and many ask what is baked in," Lipacisto wrote.

"Given a combined market cap between the two of $240b with AMD around $30b, we think the Street is baking in 15% share for AMD in servers, desktops and notebooks. Assuming our assessment of AMD's transistor lead in 2019 is correct, and Intel's supply constraints linger through mid-19, we think a market share of 70/30 is not out of the question, which would imply AMD could be a double from here."